Hiring expected to make slight gains in 2010

Monday

ROCKFORD — The country seems poised for a hiring uptick in 2010, but determining when and how much quickly turns into a game of “ask a different expert, get a different answer.”

ROCKFORD — The country seems poised for a hiring uptick in 2010, but determining when and how much quickly turns into a game of “ask a different expert, get a different answer.”

According to Business Roundtable, an association of chief executive officers of leading U.S. companies, half of its member CEOs expect no change in their company’s employment in the next six months; 31 percent expect it to decrease.

Employment services company Manpower Inc.’s survey shows 73 percent of employers expect no change in their hiring for the first quarter of 2010, with 12 percent expecting an increase and the same amount planning decreases. Among Rockford-area companies, 76 percent expect to stay stable, with 13 percent planning to hire and 9 percent planning cuts.

Outplacement firm Challenger, Gray & Christmas calls for hiring to outpace job cuts in 2010, although real growth is likely still a year or more away.

“As business owners begin to be convinced that the turnaround is for real and it’s not going to turn south at any moment, they can begin to put the negative experiences behind them,” said John Challenger, the firm’s chief executive officer. “We talk about consumer confidence, but this is business owner confidence. It’s the idea that every time they tried to hire when they had a surge in business, it was the wrong decision. They’re hunkered down and just trying to survive.”

Temporary hiring up
Despite the mixed results from various business think tanks, some economic indicators are popping up that show the pump may be primed for a modest hiring surge in the first part of 2010.

The number of temporary workers in the United States has increased for four months straight after hitting a 14-year low of 1.74 million in July. Economists often point to temp hiring as a leading indicator of economic growth.

December is typically a slow month at staffing firms, but not so this year. LoRayne Logan, president of Workplace in Rockford, said she’s seen a steady increase in orders for temporary workers since just after Thanksgiving.

“I am seeing levels now I had not seen throughout ’09,” she said. “I’m not seeing any new jobs, but I think companies had been so lean that with a little surge in business for them, they’re needing more staff.”

Her firm has arranged a few direct hires, but most of the orders have been for temporary help. But compared with a bubble of hiring she saw this summer, when firms needed workers for just a few weeks, the job offers have been more open-ended.

“I think we’ve gone from a blip of a few weeks to a blip of a month and even a quarter,” she said. “They don’t have confidence beyond that, and until we see what becomes of cap-and-trade and the health care bill in Washington, they probably won’t.”

Jobless rate an imperfect sign
But even if the indicators of an employment recovery begin to show, don’t look for signs in the monthly unemployment data.

Using the unemployment rate to measure a region’s economic health is popular because it’s the most immediate data available, but it has its downsides.

It doesn’t measure the quality or quantity of work — for that, the Bureau of Labor Statistics puts out data on productivity and hours in an average workweek.

It doesn’t measure the churn of people leaving their jobs, finding new ones and how many positions are open at the nation’s businesses, all ways to measure the health of the employment situation. For that, BLS issues the monthly Job Openings and Labor Turnover Survey, also called the JOLTS report.

And it can rise even without more layoffs. To be in the labor force and counted in the monthly measure of employment, one must either hold a job or be actively looking for work. Stop looking for work, and you drop out of the labor force.

The federal Bureau of Labor Statistics calls these people “discouraged workers,” of which there were 5.6 million in November. The measure isn’t available locally, but if people restart their job searches, they can increase the unemployment rate even if not a single person loses his or her job.

“It’s a sample-based survey of who is in the labor force,” said Joel Cowen, assistant dean of health systems research at the University of Illinois College of Medicine at Rockford. “You could have growth of jobs and still have high unemployment.”

Hours, jobs available
One of the most likely ways for employers to match increasing workflow — giving more hours to part-time workers — won’t show up in unemployment rates, either.

More than 9 million Americans, former full-timers, were working part-time hours in November, according to the Bureau of Labor Statistics. That figure was down slightly from October but still has more than doubled in the past two years.

Those workers are likely to start getting more hours, or current employees would start logging overtime, if business owners aren’t ready to hire yet, Challenger said.

“There’s a lot of room to move there. If it happens, it won’t immediately show up in unemployment data, but it doesn’t mean things aren’t starting to grow.”

Even with increasing part-time workers’ hours and using staffing firms, companies still are hiring.

There were 2.5 million job openings on the last day of October, according to the most recent JOLTS report. Nearly 4 million people were hired in the same month.

Although the unemployment rate remains high, the churn of the job market continues even in a recession.

“Sometimes people think the job market is stuck, mired, frozen, whatever you want to say,” Challenger said. “It’s not. The losses are just outnumbering the gains. Lots of people are getting jobs, and there are still jobs to be had.”